California Single-Member LLC — Formation & Tax Guide

A single-member LLC in California provides liability protection for solo owners but comes with California's mandatory $800 annual franchise tax — even if you earn nothing. The tax burden is significant: $800/year minimum plus state income tax up to 13.3%. See all LLC types or our formation guide.

California-Specific Considerations

$800 franchise tax: Owed annually regardless of revenue. First-year exempt for 2024+ formations. This is the single biggest ongoing cost for CA single-member LLCs.

Community property: California is a community property state. If you form your LLC using community funds, your spouse may have a community property interest — though for tax purposes it remains a single-member LLC.

Form 568 filing: Single-member CA LLCs must file Form 568 (LLC Return of Income) with the FTB. Due date: April 15 (same as personal return). This is an informational return plus the $800 tax payment.

Tax Treatment

Default (disregarded entity):

• Federal: Schedule C on Form 1040
• California: File Form 568 (informational + $800 tax), plus personal Form 540 reporting LLC income

S-corp election:

• Saves federal SE tax on distributions
• CA: pay 1.5% net income tax (minimum $800) via Form 100S instead of flat $800 via Form 568
• Beneficial when net profit exceeds ~$80K

FAQ

Does a dormant single-member LLC still owe $800?

Yes. The $800 is owed every year the LLC exists — regardless of activity, revenue, or dormancy. The only way to stop it: formally dissolve.

Can I elect S-corp as a single-member CA LLC?

Yes. File Form 2553 with the IRS. California automatically conforms. File Form 100S instead of Form 568.